Bubble Bubble Toil and Trouble

[QUOTE]I think that the Canadian real estate market especially in the big cities like Toronto, Vancouver and Calgary is in a huge bubble due for severe correction anytime now.[/QUOTE]

http://www.youtube.com/watch?v=Bdr37-nS5UI

A Bubble is when there is so much inventory available that No One, No Body, Any one - any longer wants to buy anything and the remaining inventory then needs to slash pricing to sell.

I am not in other cities I am in Toronto. Is a 300K unit affordable for a single person in DT Toronto? UMM Yes. yeah at $1300 pm purchase vs the rental of $1500. If there were so many for sale..... Then the owner's would rent them. If there were so many available..... then the rental price would decrease to meet the available rental pool.

To the [individual] who wrote there are 17,000 units are pending closing in 2010. (Possibly I am not aware how this number was sourced). Yeah! All with 20 % prepaid down payments, All Purchased in 2007, 2008 pricing, with committed financing and people living in them. (either as a rental or as end users) Occupancy dates are 4 - 6 months prior to the Registration of a Condominium Corporation (building).

In 2008 the Toronto Real Estate Board reported 94,000 sales for the entire year. Given that the condo market is almost 40% of all units sold under the $500 K mark, 17,000 units in a given year is not an impossible number to justify in a city (GTA) of almost 4.5 Million people.

The economy and real estate held their collective breath for a potential correction Nov '08 to March '09 and we decided, that we as Canadians, are ok.

People who make blanket statements like this have a woeful misconception of the buying a condo unit process from a builder. Cranes on Site mean the buildings are SOLD. Permit costs have been paid based on the total number of units proposed and Lot Levies committed and assessed.

There is currently an inventory shortage and there are people lined up, coming to large urban centers in Canada. Why? Employment. We have continued immigration for jobs and education. We need more immigration in Canada. We want more immigration and scholars. Canada's banking system was lauded as a sample for the world at the G7 summit. Single women are now a market force buying on their own. Canada is a safe haven for investment dollars. To those that are always yelling the loudest about 5% buyers ending all the loans Canada, You really need to read this; Average Canadians are 1/3 mortgage free and that the average mortgage is at 50% of the property value. Pick one you like.

Everyone has their own opinion and you are all right.

Buyers Market? Seller Market? Balanced Market? Where are we?

If you call or email we can discuss absorption rates (How quickly a price range or type of home/condo is being bought up) We can look at Historic Listing Inventory for the last 18 months. OR the best? READ a copy of the Market Watch Report from the Toronto Real estate Board published monthly. Lets Talk average Mortgage for Canadians.

I am not a proponent of Bubble. I am not screaming Run and Buy before prices skyrocket, I am an advocate of buy what you can afford as a hedge against inflation. You need to live somewhere.

You cannot move into your Tax Free Savings Account!

You decide. but get informed intelligent answers to your questions. What are your FAQ's Add them here and I will try to answer.

February Inflation Rises to 1.4%

Canada's annual inflation rate rose in February to 1.4 per cent from the 1.1 per cent rate seen in January, Statistics Canada reported Thursday.

Economists had been looking for 12-month inflation to cool a bit to one per cent for February.

Higher prices for food and shelter were the primary reasons for the increase, Statistics Canada said.

Food prices increased 7.4 per cent during the 12-month period to February, following a 7.3 per cent increase in January. The main contributors to the overall jump in food costs were a 25.8 per cent hike in the price of fresh vegetables, a 9.7 per cent rise in the price of bakery and cereal products, and a 6.1 per cent increase in meat prices.

Shelter costs, the second-largest factor, increased 3.0 per cent, which was slightly less than the 3.3 per cent rise in January.

Holding inflation back was a year-over-year decline in the price Canadians were paying at the gasoline pumps. Gasoline prices in February were 19.7 per cent below levels in February last year.

Excluding gasoline, the annual inflation rate rose 2.5 per cent in the 12 months to February.

The Bank of Canada's core inflation rate — which factors out many volatile influences and is used by the central bank for the purpose of setting monetary policy, such as lending rates — advanced 1.9 per cent over the 12 months to February, identical to the increase posted in January.

David Pylyp: With declining prices in real estate, and all the talk of recession, many of the talking heads on TV (Media) are discussing deflation.  Things should be going down in price in a recession. During a recession, there should be no inflation, as we are in recession. the Bank of Canada usually increases interest rates to combat inflation. Right?

Yet here are the same people discussing the fact that although real estate values are down slightly in Toronto, vehicle prices are down, the financing options, product availability and pricing make this a good time to buy large ticket items.

What I do see happening, is a strong pend up demand from buyers that still need a place to live in Toronto and are continuing with their property search albeit carefully and with a little more prudence. Neighbourhood and indeed condominium complexes are becoming more balanced in pricing as buyers compare square footage, amenities and neighbourhood localism.

Your comments are always invited.